Insurers and brokers agree to fix fees<\/p>\n
JAKARTA (JP): Insurance companies and brokers have agreed to
\ndecide the level of brokerage fees on fire loss insurance and
\npremium discounts in a bid to stabilize the market, an industry
\nexecutive said yesterday.<\/p>\n
Chairman of the Insurance Council of Indonesia Munir
\nSjamsoeddin said based on an agreement signed Monday by the
\ncouncil and the Association of Indonesian Insurance Brokers,
\nbrokerage fees on fire loss insurance should be set at a maximum
\nof 15 percent of premiums.<\/p>\n
Nontechnical rebates for policy holders or insurance sale
\nagents which do not hold Ministry of Finance license would be set
\nat a maximum of 5 percent of premiums, he said.<\/p>\n
If an insurance agent has a ministry license the maximum
\nrebate would be 10 percent, he said.<\/p>\n
"This agreement will be effective from March 11," Munir said.<\/p>\n
Insurance executives said the agreement was necessary to help
\nstabilize the insurance market because insurance firms were now
\ncompeting by offering cheaper fees to brokers and bigger
\ndiscounts to policy holders. So brokerage fees and premium
\ndiscounts are determined on the basis of negotiations.<\/p>\n
Wars in brokerage fees and premium discounts started in 1988
\nafter the government deregulated the insurance industry. The
\ninsurance and brokerage associations tried to reduce the
\ncompetition by signing an Inter-Company Agreement in 1992 but it
\nwas not effective because it did not sanctions violators. The
\nagreement was revised last December to introduce sanctions.<\/p>\n
Insurance council tariff bureau head I. Handono Notoprodjo
\nsaid the association planned to introduce new tariffs on fire
\nloss insurance in about three weeks. (10)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/insurers-and-brokers-agree-to-fix-fees-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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